Thursday, April 29, 2010

NJ union pension fund sues to remove coal boss


Massey Energy logoThe New Jersey Building Laborers Pension Fund, a shareholder of Massey Energy Co., has brought a civil suit against Massey Energy Co and its CEO Donald Blankenship following the deaths of 29 workers earlier this month at the company’s Upper Big Branch mine in West Virginia.

Long before drilling crews began boring into the Upper Big Branch mine in a desperate effort to rescue miners from the nation's worst mining disaster in four decades, Massey Energy Co. had not simply disregarded mine safety regulations - it treated them with contempt, according to the derivative complaint filed against Blackenship and Massey’s directors.

Upper Big Branch Mine (Massey Energy) death tribue April 2010 - WV Gazette "Given Massey's chronic unwillingness
and failure to adhere to mining safety regulations," the death of 29 workers on April 5 "did not come as a surprise to many," the complaint states.

Massey has racked up nearly $27 million in fines since June 2008, nearly $13 million of them in 2009, according to the Chancery Court complaint. 

Massey owes "$25.6 million of still unpaid fines since 2005;"
10 of its 23 coal mines "had injury rates that exceeded the national rate;" four of those had injury rates "more than double the national average, and the 10 mines together received 2,400 federal safety violation citations in 2009 alone," according to the complaint. 
Donald Blackenship ouitside trailer
The plaintiffs focused their harshest criticism on "Massey's imperious CEO and Chairman, Donald Blankenship."

"The Board's unwillingness or inability to prevent one man's heedless and misguided views from determining company practice has resulted in needless, tragic destruction of human life, as well as severe damage to the Company's reputation and finances," the complaint states. "It is not in the company's interest to continue to accrue fines or penalties as a result of this pervasive, and apparently continuing, pattern of flagrant disregard for mine safety laws and regulations."

The union fund managers are seeking punitive damages for breach of fiduciary duties. They also want all the company's mines inspected and Blankenship removed from office.

Mine Blast Was No Surprise, Shareholders Say 
Coal miners evacuated after surprise inspections 
Surprise inspections at 3 Massey-owned mines

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